REP FC 126 2018/07/24 (2016-2018)

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REPORT OF THE COMMITTEE ON FINANCE DATE: July 24, 2018 Re: Comm. No. 989/Bill No. 165 PLACE: Council Chambers Kailua-Kona, Hawai`i TIME: 1:32 p.m. Council Chair and Members Hawai`i County Council • Hilo, Hawai`i 96720 Your Committee on Finance, to which was referred Bill No. 165, reports as follows: Bill No. 165, transmitted by Council Member Dru Mamo Kanuha, via Communication No. 989 dated July 6, 2018., amends Chapter 19, Article 10, of the Hawai`i County Code 1983 (2016 Edition, as amended), relating to real property tax exemptions for disabled or unemployed veterans. This bill removes the phrase "totally disabled" from Section 19-73, and replaces with"100 percent disabled or 100 percent unemployable, or both." Further amends Section 19-73 to exempt disabled or unemployable veterans from all real property tax, where "totally disabled" veterans are currently subject to the minimum tax provided for in Section 19-90(e). Council Member Dru Mamo Kanuha explained the purpose of amending Bill 165 regarding the real property tax exemptions is for the 100 percent disabled and 100 percent unemployable veterans. Mr. Kanuha stated when the minimum tax was increased, it was increased for those disabled and unemployable as well, putting a burden on the veterans having to pay double the amount. Mr. Kanuha consulted with the Finance and Real Property Tax departments to find out who falls into the 100 percent disabled category. At the same time the Real Property Tax Task Force came out with a recommendation that the annual veteran real property tax be zero. A requirement to receive this benefit is that the person must be 100 percent disabled or 100 percent unemployable due to a service related injury and the veteran is a primary homeowner. Lisa Miura, Real Property Tax Administrator and Keita Jo, Acting Assistant Real Property Tax Administrator answered questions on the approximate count of people that would be receiving this benefit. Mr. Jo updated some of the numbers. The current count for individuals receiving veterans' disability is 656 and the taxes representative of that is $131,200. Individuals go through an application process with the Veterans Administration, and once completed, the Veterans Administration will sign off as being 100 percent disabled/unemployable. Council Member Aaron'Chung stated it is difficult going against something that is in appreciation of our veterans who have given the ultimate sacrifice, but states he is troubled with the elimination of the minimum tax. Mr. Chung would like to recognize what our veterans have given to all of us but feels they still need to pay the minimum tax. FC Report No. 126